NDTV: Ahead is the next round of the Strategic Dialogue between the United States and India. Where does the equation between Washington and New Delhi stand? What’s working and what’s not? What are the irritants? For example, how big an irritant is Iran? What about the volatility of the subcontinent with what many believe is a deteriorating relationship between the United States and Pakistan? To address all of these questions and much more, I am joined now by the U.S. Under Secretary of State for Political Affairs Wendy Sherman.

It’s a pleasure to have you on the program, Ms. Sherman.

Under Secretary Sherman: It’s good to be with you. Thank you.

NDTV: How has the trip been so far?

Under Secretary Sherman: The trip has been great. It is always wonderful to come to India. I’ve been here many times and I’m delighted to be here again in my official capacity.

NDTV: You have an interesting city on your itinerary, Patna in Bihar. How come?

Under Secretary Sherman: I wanted to get outside of Delhi. I love coming to Delhi and seeing lots of old friends, and of course having government meetings. But I think whenever you go to a country it’s important to get outside the capitol and see what’s really happening. There have been a lot of terrific press stories about what’s happening in Bihar, a state that has great poverty but has made enormous strides, is seeing impressive growth numbers, increasing literacy, businesses arriving, and it shows what governance and commitment and making education and growth a priority can accomplish. So I want to go see what the citizens and the government of Bihar are doing.

NDTV: Interesting.

In your speech at the American sector you addressed the cynics in the media and in other corners that speak about the relationship between Washington and Delhi being adrift. And you said I’m not sure that you felt that many of these differences were over-emphasized, that they were tactical rather than strategic. What gives you that optimism?

Under Secretary Sherman: I think what give me the optimism is how much we have accomplished together. There is an extraordinary list of things that we’ve done together in the field of technology, in the field of defense co-production and co-development, in the fields of agriculture, business relations, public/private partnerships, health care, and I see that just strengthening over the years. To come. Both the United States and India are powers in the world and everything in the world these days is interconnected so it takes these very strong strategic partnerships, what President Obama has called really the indispensable partnership, to try to solve some of those very tough problems.

You mentioned Iran, for instance.

NDTV: I was coming to that.

Under Secretary Sherman: I’m sure you were. One of the very tough security issues confronting the world. The entire international community is very concerned that Iran is on a path to acquire a nuclear weapon. India has long been a leader in non-proliferation and four times both India and the United States have voted at the IAEA, the International Atomic Energy Agency, for resolutions that say to Iran we don’t think you’re really answering the questions of the international community about whether you do have a nuclear weapons program. Iran, of course, can have peaceful nuclear energy if it meets its international obligations, but there is great concern and we’ve had UN Security Council resolutions to this effect, that Iran is in fat trying to develop a nuclear weapon. So India and the United States together are trying to meet that challenge. Sometimes we have a little bit of a difference on tactical, how effective sanctions are, whether in fact there are other ways to move forward, but we both agree that this issue has to be addressed. We both want dialogue to address it, and I’m hopeful that when the P5+1 join together in talks with Iran that are likely this month that we will begin to make constructive use of those kinds of talks.

NDTV: You mentioned tactical differences as to whether sanctions against Iran are the best way to go forward. You would have foreseen a declaration by the BRICS countries, BRICS held in Delhi called the Delhi Declaration, that basically said sanctions are not the way forward, that defended Iran’s right to a peaceful use of nuclear energy, and that signaled its alarm and possibly military conflict arising on the issue of Iran.

Is Washington worried about the BRICS Declaration?

Under Secretary Sherman: No. Washington thinks it makes perfect sense that the BRICS would get together, would talk. These are all emerging and developing economies that re powers in their own right. We understand that they want to have a dialogue with us. There are more regional organizations and global organizations than you and I could list during your whole program. So all of these are different ways that we all communicate with each other, develop constituencies, and purpose. And indeed, we don’t disagree that dialogue is the best way forward. We don’t think a military action is the right way forward. Nonetheless, President Obama has said that there is not an unlimited window for that dialogue. We believe, as the rest of the P5+1 do together that we ought to have a dual-track approach -- engagement and pressures to open the space to have that engagement and to say that Iran must be serious about achieving concrete results in answering the questions the international community has.

NDTV: Obviously one set of pressures that your country is trying to use towards this end is to stop countries from importing crude oil from Iran. India imports 12 percent of our oil from Iran and it doesn’t look like this is going to be stopping any time soon. In fat we have a delegation traveling to Iran to even work out barter deals in case there is a crackdown on the currency.

Surely this is more than just a tactical difference between Delhi and Washington.

Under Secretary Sherman: I think actually my understanding is that India for its own interest and its own reasons is looking at its energy security into the future. India’s energy needs are enormous and will be growing. I think India, like every country around the world, recognizes that getting crude oil from Iran is a risk. We have seen reinsurance companies not wanting to reinsure insurance that supports tankers that deliver crude oil. We have seen financial systems that no longer allow currencies to be used to pay for Iranian crude.

So I think that many countries and I suspect India will do this for its own reasons, not because of our sanctions but for its own reasons, will want to diversify its energy resources, will want to limit the amount of oil that it gets from Iran. This doesn’t have to do with the United States. This has to do with India’s own energy security plans and its own desire to diversify its sources.

NDTV: If that were not to happen would it be an irritant in the equation of Washington?

Under Secretary Sherman: I think we will work through this as we work through any issue on which we have disagreements. It’s one thing about Indians and Americans. We’re both boisterous, we both are opinionated, we’re both argumentative, feel strongly about our positions, and yet our partnership is stronger than ever and we work our way through our problems to meet each of our national security interests, which aren’t always identical. No countries are identical. But we share a set of values that are quite profound and that has served us very well.

NDTV: Do you see a sort of mediatory role for Delhi? We’re a country which has an excellent relationship with Russia and we have an old historic equation that you recognized in your address with Iran as well. Do you at all see a mediatory role, I don’t mean an official mediatory role, but that New Delhi could perhaps use this equation to negotiate with Iran to bring the concerns of the world to Tehran’s doors?

Under Secretary Sherman: I think one thing that has been very helpful in my conversations even today with officials in the government is to better understand Iran. Because India talks with Iran -- We haven’t had a presence in Tehran for 31 years. So any country that has a presence in Tehran, that has a relationship, gives us insights, better understanding, cannot so much be a mediator because I think no country wants to be in the middle necessarily of this difficult situation. But provides insights and can be helpful in opening the lanes of dialogue and the lanes of engagement.

We very much value all of the counsel that we get from India. India is a power in its own right. Not only for its own citizens but regionally and globally and as a valued partner in so many things around the world, we listen very carefully and very closely to whatever advice and counsel India can offer to us.

NDTV: One last question on Iran before we go on to some other areas, the Non-Aligned Summit is to be held in Tehran this year. India is actually having a very vibrant debate right now as to whether or not nonalignment is something that can rise from the ashes, so to speak. That is happening in Tehran as a level of urgency to the debate.

Would the United States have a view on the Non-Aligned Summit being held in Iran? There’s an irony there, isn’t it?

Under Secretary Sherman: Again, I think this is a decision for India, not a decision for the United States about how it wants to proceed, what organizations it wants to be a part of, how it wants to operate in the world, and that’s going to be different for India than it would be for the United States. So at the end of the day as we have in the United States, it sounds like you’re having a healthy debate and will get to the answer that’s best for India.

NDTV: I’m sure we will.

I want to step back a bit and look at the region. Now we have Pakistan’s President arriving here for a lunch that’s to be hosted by the Prime Minister. At the moment it might almost be safe to say this is really ironic that India and Pakistan are in a better place than the United States and Pakistan.

Under Secretary Sherman: I don’t know whether that’s so ironic. I actually think it’s terrific what India is accomplishing. As difficult as the United States’ relationship with Pakistan has been, though I think we’re getting on a better path now than we’ve been over the last few months, I think that for India what is happening is truly historic and extraordinary. Step by step in ways that work for India, India and Pakistan are taking steps towards each other. What has been happening on trade is really quite monumental and will not only make a difference for India’s citizens and Pakistan’s citizens, but will create even greater global stability and security going forward. So I think the visit that’s to happen shortly is another step in a long process and I think I know the United States is and I think the world is very appreciative and very grateful for the courageous steps that are being taken by both countries.

NDTV: Speak a little bit though about where you see the equation with your country and Pakistan. Pakistan’s parliament is in the middle of another very boisterous debate about reopening the support routes for NATO troops. It has not happened yet, it may not happen in the imminent future. We even had a Pentagon official saying if this does not work out we may have to look towards India. Where does this [inaudible] stand for you at the moment?

Under Secretary Sherman: There are some very difficult things that have occurred along the borders among our militaries that has created concern, and we understand that and we understand that there’s a vigorous debate that is taking place. At the end of the day we believe that the United States and Pakistan will have a sustained relationship with each other because we both want to deal with terrorism as of course India does as well. We want to ensure stability and security in the region which is a high priority for India as well. So although we may have rocky times and a difficult road, something that India knows very well, we are working very hard to get to a place where our national interests, Pakistan’s national interests, can coincide in ways that create greater security and stability for both of us.

NDTV: How far would you be willing to wait for Pakistan to reverse its decision on closing the supply routes for NATO troops? There has been a suggestion in some sections of the American media that if this were not to happen immediately it could even delay the partial withdrawal of American troops that is slated to take place from Pakistan this summer.

Under Secretary Sherman: I think we will work through this issue in a way that solves whatever issues we have to face to meet our commitments in Afghanistan. I think that some of my colleagues are at work on this just as we speak, and I’m sure we’ll work through this issue.

NDTV: And are you looking at alternatives? Are you looking at India as an alternative, as a Pentagon official said, if these supply routes are not opened?

Under Secretary Sherman: I think what’s best for today is for me to say simply what I have said which is we are working through this issue with Pakistan and I’m sure we’ll come to a solution that ensures that we can keep our commitments.

NDTV: When you look at Pakistan and the United States and India, one of the interesting things that’s happening within Pakistan is actually the civilian government has survived against all odds at least up until now. And perhaps it has been the tenacity that many people would not have in a sense attributed to them given the clash of institutions within Pakistan. Does the United States see this as a healthy sign? Do you believe the roots of democracy are in a sense growing?

Under Secretary Sherman: It’s a very interesting perspective. I think that you point out quite rightly that this civilian government has continued. I think that does speak to the importance of civilian rule in Pakistan and it’s something that all of us want to support in whatever way we can because again, this is good for the people of Pakistan and this is good for the entire region.

NDTV: Some cynics say that if we say the relationship is de-hyphenated today between the United States and India, the United States and Pakistan, but it isn’t really because Washington needs Pakistan to [inaudible] for its strategic interests. Do you believe that it is actually a de-hyphenated relationship today?

Under Secretary Sherman: I think that each -- The hyphen doesn’t work anymore because hyphenation means that life is about a bilateral relationship. Although the relationship between the United States and India is so crucial and so important and so strong, and we obviously have interests that are important with Pakistan in security and stability, the world is interconnected. So multifaceted, multilateral relationships are equally important. One of the things where India has been a leader is really understanding that we really want to create what we often call the New Silk Road, some people call the Grand Trunk Road, some people call traditional trading routes, whatever title you give it, to create regional economic integration so that people, as Prime Minister Singh has said, can have a meal in Amritsar, Lahore, and Kabul -- all in a day’s work in an interrelated economic integration that creates jobs for the citizens of all countries throughout the region and throughout Central Asia, and can also make sure that our children have a great economic future and prosperity ahead.

NDTV: At the end I must ask you the good news that for many pro-democracy supporters is coming in from Burma. Suu Kyi’s win despite some apprehensions about how free and fair the elections were. The next big question is could we see sanctions being lifted in what is now known as Myanmar?

Under Secretary Sherman: We think it’s just extraordinary what occurred in the election. I think it’s a great moment for the world to celebrate what the people of Burma themselves have done. Aung San Suu Kyi has just been extraordinary. I’m not sure that I would have, for the many years that she has been as steadfast in her beliefs, in her commitment, in really the shining star that she has made for all the people in her country. My hat goes off to all the citizens of Burma in the elections that were held, that appear although there may have been some irregularities, there are irregularities in elections in the United States of America. But it appears that for all intents and purposes this was a free and fair election and marks the beginning of the next stage in Burma’s change into the future.

I’m sure somewhere along that road we will all address the sanctions that have been placed on Burma in this step by step process, and we certainly hope that what was achieved in this election is a step towards an irreversible process.

NDTV: Is it too early to talk about reversing sanctions yet?

Under Secretary Sherman: I think we’ll take this step by step.

NDTV: As we close, you ought to know India well as you spoke about it wearing your other hat as a business woman. Do you find India has changed from the time that you’ve known it?

Under Secretary Sherman: I think that over the years, I have to think back when I first came to India, it was some years ago. India is so dynamic, there is so much going on in terms of business development, investment. I realized in looking over my notes getting ready for this trip that we will surpass $100 billion in two-way trade in goods and services between our countries. That is simply extraordinary. And I would suspect within a decades that will double. So where we are headed is, it’s really the sky’s the limit and whether it is in Patna where literacy is increasing, where businesses are now beginning to thrive. Someone told me that from an American point of view there’s now a Domino’s Pizza and a Gold’s Gym, which I find extraordinary. I hope people are enjoying them.

NDTV: Eating the pizza and then going to the gym.

Under Secretary Sherman: I guess the two go together somehow. That I see everywhere throughout this country dynamism, young people Tweeting and using social media. I know you are a leader in that regard in the use of social media in this country. The technological changes that are occurring here are just amazing. And at the same time with all that dynamism India is taking on the still tough challenge of poverty beyond people who want to make sure they have a job, a move to cities that are growing enormous in size, so it’s quite extraordinary what’s happening here. I hope all Americans come and visit and I hope all Indians come to the United States.

NDTV: It’s a paradox in country, but we hope you have a great trip. Thank you, Wendy Sherman.